Genitics, a KOSDAQ-listed semiconductor fabless company led by CEO Kwon Seokman, announced on June 23 that it would take a firm stance against the spread of false information ahead of its extraordinary general shareholders' meeting scheduled for July 9.
The company stated that it had sent official warning letters to the parties involved through its legal counsel and declared its intention to take civil and criminal action if the dissemination of false materials continues.
Genitics' legal representative, Sigong Law Firm, recently sent a letter to Halo Electronics (CEO Hong Geunui) and Bside Korea (CEO Lim Seongcheol), the proxy voting agent for the Halo side, demanding an immediate halt to the spread of false information during the proxy solicitation process.
Halo Electronics is the Korean subsidiary of Halo Microelectronics International (HMI), the largest shareholder of Genitics.
According to the letter, Halo Electronics recently distributed documents in the form of "proxy solicitation reference materials" to Genitics shareholders and posted related content on its website, claiming that Genitics management had leaked company assets or engaged in actions favorable to third parties.
In particular, the Halo side claimed that the new product HM5600, currently under development by the Halo Group, and certain equipment had been leaked to Elevation Microsystems by Genitics management.
In response, Genitics emphasized that all such claims are completely unfounded. Regarding the HM5600-related product, the company clarified, "This was a project halted at the planning stage and was never actually designed, produced, or sold," stating that the claim is clearly false.
Regarding the controversy over the removal of certain equipment, the company countered, "This is a misunderstanding regarding equipment in a shared office. The claim that Genitics assets were removed without authorization is entirely untrue."
In fact, the equipment in question was located in the Halo office from the beginning, and at the time of the incident, Elevation and Halo were officially sharing the office space.
Genitics views the distribution of such false materials as a deliberate act intended to distort shareholder judgment ahead of the extraordinary shareholders' meeting, and stated that it will respond strictly to protect the company's credibility and shareholder rights.
Sigong Law Firm cited Article 154 (Prohibition of False Statements on Material Matters) and Article 156 (Prohibited Acts Related to Proxy Voting) of the Capital Markets Act, warning that violations may result in imprisonment of up to five years or a fine of up to 200 million won. The firm also mentioned the possibility of criminal liability for defamation.
A Genitics official stated, "We can no longer stand by as false information about our company is spread ahead of the shareholders' meeting," and added, "We will respond firmly to any actions that hinder shareholders' rational decision-making."
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